Agricultural Output Climbed in 2013, Recovering From Drought

June 20, 2014

Off the Charts

By FLOYD NORRIS

AGRICULTURE is a small part of the United States economy, but last year it was the best part.

The output of the agriculture sector grew 16.4 percent after inflation last year, the fastest rise for the sector since at least 1998 and far faster than any other part of the economy. The nation’s gross domestic product grew just 1.8 percent, while the second-fastest growing sector, the information industry, rose 3.2 percent.

Last week, the government released its estimates of state economic growth in 2013. North Dakota led the pack with a growth rate of 9.7 percent. Alaska was the only state whose economy declined, shrinking by 2.1 percent, largely because of declining oil production.

The economy of the District of Columbia also declined, but that was because of cuts in government spending.

North Dakota benefited from its rising production of shale oil, but it was also helped by the fact that its agriculture sector amounts to 12.9 percent of the state’s economy, more than that of any other state except South Dakota.

By contrast, agriculture accounted for just 1.6 percent of the country’s overall output in 2013. But that was the largest share in recent years, up from a recent low of 0.9 percent in 2006. The agriculture sector includes forestry, fishing and hunting as well as farming, but farming is much larger than the other categories.

Last year, the government changed the way it calculated G.D.P. figures, including counting research and development spending as investments rather than as consumption. It revised historical figures only back to 1997, so earlier years’ output and growth figures for agriculture are not comparable.

Mitch Morehart, an economist with the Agriculture Department, said the strong growth in agriculture reflected a recovery in production for some crops after a drought in 2012, as well as strong production and rising prices for livestock. This year, he said, it appears that agriculture is not doing nearly as well.

Over all, the economies of the 10 states that are most dependent on agriculture grew at an average annual rate of 3.4 percent in 2013, while the 10 states that are least dependent on the farm economy grew at an average rate of 1.3 percent.

California is by far the largest agricultural producer, accounting for $46.7 billion, or 17 percent, of the total national agricultural output of $269.1 billion. But the state is so large that agriculture makes up only 2.1 percent of its output, less than 16 other states. Iowa, which ranks second in dollar value at $16.1 billion, depends on agriculture for almost 10 percent of its total economic output.

The 2013 surge in agriculture ended a string of three years in which that sector did not do as well as the overall United States economy. But since 1998, agriculture outperformed the rest of the economy in nine of the 15 years. During that stretch, agriculture grew at an annual rate of 4 percent, double the 2 percent average for the national economy.